New thread started as Epic changed from LAF to LONR - May 07.





Epic : LONR

Web Site : http://www.lonrho.com/


Its something different, and something exciting imo.



Nice recent Telegraph write up to (April 2007) :

http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2007/04/04/cnlonrho04.xml


.

you get the feeling that Lonr is going up a gear. I am sure the Company will be highlighted in the media again. Probably some more African Funds trying to get on board.

Lonrho PLC 01 October 2007

Lonrho Plc
('Lonrho' or 'the Company')

Lonrho signs Heads of Agreement to lease and manage a 5 star,
256 room hotel in Democratic Republic of Congo

Lonrho (AIM : LONR), the conglomerate with a structured portfolio of African
investments, is pleased to announce that it has signed a Heads of Agreement with Luano Grand to lease and manage a 256 room, 5 star hotel at the proposed Luano Grand development in Lubumbashi, in the Democratic Republic of Congo.

Luano Grand ( http://www.luanogrand.com ) is a proposed mix-use retail, residential, office and hotel complex that was officially launched at the South African Consulate in Lubumbashi on Friday 28th September 2007. The launch was presided over by His Excellency Moise Katumbi, the Governor of Katanga Province and a number of Ministers of State and Government officials from South Africa and Belgium. Construction of the complex is scheduled to begin in 2008.

Amongst the 300 guests attending the launch of the project were representatives
of the IDC (Industrial Development Corporation) and DBSA (Development Bank of
South Africa).

The hotel will have 256 rooms and 50 long stay apartments and is designed to be
connected to a retail mall, which in turn will have access to offices and
residential units. Lonrho Hotels, a division of Lonrho Plc, will lease and
manage the hotel and long stay apartments in the project.

David Lenigas, the Chairman and CEO of Lonrho Plc, commented :

'The development of Katanga Province in the DRC is being fuelled by the
significant foreign direct investment into the mining of the copper and cobalt
natural resources in the region. Companies such as Phelps Dodge and Nikanor are
investing an estimated US$ 4 billion in mining projects in Katanga over the next five years and, with this, the demand for quality accommodation and support services will be significant. Lonrho is delighted to be involved with this major, forward-looking project that will generate jobs and prosperity.'

Lonrho PLC said it has signed an agreement with Luano Grand to lease and manage a 256 room, 5-star hotel at the proposed Luano Grand development in Lubumbashi, in the Democratic Republic of Congo.

Luano Grand is a proposed mix-use retail, residential, office and hotel complex and its construction is scheduled to begin in 2008.

The hotel will be leased and managed by Lonrho Hotels, a division of Lonrho PLC.

http://business.timesonline.co.uk/tol/business/money/article2557110.ece

From The Sunday Times

September 30, 2007

Merryn on Money: Time to adopt Africa by Merryn Somerset Webb

Im looking for a safe haven for my money. It isnt easy. Things seem to be getting worse and worse in America.

The International Council of Shopping Centres reported that retail sales fell 1% overall last week. Target, the second-biggest US discount chain, cut its forecasts for September sales to 1.5%-2.5% from 4%-6%.

There was worse news for property. The S&P/Case-Shiller 20-city index reported that prices fell by an average of 3.9% year-on-year. The index fell on an annual basis in January for the first time, and has fallen every month since. Fifteen of the 20 cities saw declines, with the largest in Detroit, down 9.7%.

Anyone who thinks global property or US shares are always a good long-term bet should hotfoot it over the Atlantic now. I wont be joining them.

Then there is Europe. Ireland and Spain have been responsible for about a quarter of Europes growth in the past four to five years, but now the main drivers - building and buying houses are in mid-collapse.

At the same time there is little real evidence to back up the optimistic view that the European economies and markets have somehow decoupled from Americas. They havent: 15% of EU exports still end up there.

Decoupling is a buzzword in Asia too. Here there is evidence that domestic economies can thrive independently, and it is certainly true that given the choice between an American fund and an Asian fund, Id take the latter in a heartbeat. But I still dont think there is any way Asia can escape a US recession unscathed. America may no longer be the only engine of global growth but it is still the main one.

So where can you find a market that is genuinely uncorrelated with the rest of the world? The answer, counter-intuitively, is Africa. Since I last wrote about investing there in February, the headline news on the continent has been as unremittingly miserable as usual. But behind the scenes the economic fundamentals have just kept getting better.

GDP growth across the region has been rising fast (well above 5% in 2005 and 2006 and a forecast 6.8% this year) and is expected to keep doing so. This is partly down to the commodities boom and to the continents new best friend, commodity hungry China. Sino-African trade hit $55.5 billion (27.4 billion) last year, up 40% from the year before, and China has now directly invested more than 3 billion into Africa. This is not just upping average incomes but rebuilding roads, railways, ports and schools across the continent.

But the boom in Africa isnt just about China; its about increasing political and financial stability (which makes the region investable). Note that two African countries Libya and Algeria actually make it onto the World Economic Forums list of stable economies.

Its also about soft commodities. There has been much hand wringing about how urban Africans will suffer from rising food prices and they probably will. But lets not forget that the majority of poor Africans are still farmers.

So rising prices will surely bring them rising incomes, perhaps even some surplus income.

And as a welcome side-effect this might encourage them to stick with trying to make money from the land rather than migrating to cities that arent yet ready for them. Its just a horrible shame that Zimbabwe, once one of the biggest exporters of grain on the continent, is missing out.

Africas renaissance is also about other noncommodity industries. The tourism, telecoms and financial sectors are expanding fast, as are the many companies providing things such as soap, chocolate and beer to people with a tiny bit more spare cash than a decade ago. Its also worth noting that the fastest-growing economies are very often those that have little or no commodity exposure Kenya, for example.

And the best thing of all? History shows that African markets move with very little reference to global markets. They are, says Mark Foster-Brown of Altima Partners, utterly uncorrelated to other financial markets, a characteristic not to be sniffed at in the current environment of total correlation of everything else.

So how can you get in? It isnt easy. In February, I suggested buying shares in AIM-listed Lonrho, which has investments across the continent in everything from water plants to airlines and which seems to make a new deal every week. The shares are up 40% since then and I still like them (they are in my pension) but, given the speed of the companys expansion, they dont necessarily make a safe haven.

The good news is that in the past few months a few funds that give the retail investor access to Africa have appeared on the market. Most interesting of the lot is Charlemagne Capitals Magna Africa fund. This has raised well over 40m since its launch only three months ago, and probably for good reason it is one of the few Africa funds that doesnt come with an absurdly high minimum investment, while Charlemagne has an excellent record in local emerging markets.

Otherwise, coming soon is the New Star Heart of Africa fund to be run by Jamie Allsopp. Those who cant wait for that launch might look at Allsopps UK Hidden Value fund, which already has large Africa-related holdings, including shares in Lonrho.

Merryn Somerset Webb is a former stockbroker and now editor of Money Week. Her views are personal and investors should always seek professional advice.

Write up on the LonZim Offering.

http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article2578198.ece


October 3, 2007

Lonrho aims high with plan for LonZim offering

David Robertson

In what must be one of the...........................................

http://news.bbc.co.uk/2/hi/africa/7038394.stm


Wednesday, 10 October 2007, 17:38 GMT 18:38 UK

......................................................"Sub-Saharan Africa is a particularly strong growth market," he told the BBC.

"You're talking about a region that has 15% of the world's population, 20% of the world's land mass, but only produces 2% of global output at this stage. Against that backdrop sub-Saharan Africa is actually increasing its exports to China, whereas the rest of the world is doing quite the opposite.

"So what we have is a huge, untapped, but not very well understood, investment opportunity in all shapes and sizes," he said.

Unlike several other parts of the world, sub-Saharan Africa is showing high growth rates - with the banking sector, for example, growing by 90% over the past few years.

Analysts say, however, that the risks of investing in Africa are still high, because of factors like poor infrastructure and corruption - but they say that also means the rewards are potentially much higher..............................................

THANKS PP.

Lonrho PLC
15 October 2007
LONRHO PLC
(Lonrho or the 'Company')

Lonrho increases equity stake in Container Shipping Company SAILS to 51%

Lonrho (AIM: LONR), the conglomerate with a structured portfolio of African
investments, is pleased to announce that it has acquired a further 6% of SA
Liners Limited ( 'SAILS' ) for US$500,000, taking Lonrho's holding in SA Liners
to 51% of the company.

This increase reflects the Board of Lonrho's strategy that Lonrho should,
whenever possible, maintain a majority shareholding and Board control of all
group companies.

Lonrho acquired 45% of SAILS and Board control in July 2007 for an investment of US$ 6 million. Since Lonrho's investment, SAIL's operations have expanded and the fleet has grown from two to five vessels in service, which will be increased to seven vessels by early December.

Lonrho increased its shareholding in SAILS under the terms of a convertible
working capital facility that had been put in place.

David Lenigas, Lonrho's Executive Chairman commented:

'SAILS is a core Lonrho business with significant potential. Strong demand from customers has led to the recent increase in vessels in service and we also
expect there to be further expansion of the SAILS fleet next year.

'Lonrho's increased equity in SAILS is another example of the Company's
objective to hold a majority stake in each of its subsidiaries.'

http://secure.financialmail.co.za/07/1012/moneyinvest/kmoney.htm

12 October 2007

LONRHO

Return of the great investor
By Sasha Planting

Once it was the only company that dared invest in Africa. But excessive ambition and rampant egotism led the once-mighty Lonrho into crippling debt, forcing executives to dump assets in a fire-sale that lasted a decade.
Today, a refocused Lonrho is again gobbling up assets across Africa, unashamedly aiming to become the pan-African conglomerate it was, according to executive chairman David Lenigas.
Last week Lonrho (previously Lonrho Africa) announced the acquisition of Zimbabwean companies Celsys, an ICT player, and chemical supplier Millpal - investments that were not well received by the British press.
These companies will be offered to LonZim, the 32m fund that Lonrho has established and plans to list later this month. It will be used to invest in hard assets such as property and hotels in Zimbabwe and neighbouring countries.
These deals follow September's announcement that Lonrho had acquired 51% of Mozambican microfinance bank Socremo and, before that, 100% of Swissta, a bottled-water manufacturer, and 65% of Bits & Bytes, Mozambique's biggest commercial IT distributor. Unremarkable deals perhaps, but to Lenigas they are just the beginning.
" Africa is being screwed by the financial institutions," he says. "Interest rates are exorbitant and the process to get a commercial loan is ludicrous. It is inhibiting Africa's growth. I'm excited about microbanking in Mozambique."

Lenigas plans to expand these businesses across Africa. "I'd like to see the microbanking operation in six countries within a year. And within the next few months we will establish water-bottling facilities in three or four countries, and will be in 30 countries within five years. We will focus on a premium brand for tourists and low-cost water for people who can't afford that."

Lenigas, an Australian miner, knows Africa intimately. He has run diamond fields in Angola (for the Kebbles) and gold mines in Ghana. " Africa is open for business - the development on infrastructure build is similar to that in Asia 20 years ago. I want to create an environment where international business can travel, stay and move product around. That's where we are investing - hotels, ports, low-cost airlines."

Lonrho's decision to stop disposing of assets and expand back into Africa came about at an extraordinary AGM in February 2006 when shareholders agreed to a new vision and focus for the company.

This followed a decade of disposals, including mines, hotels, motor dealerships, logistics and media operations, cotton, sugar, timber, textile and meat-processing operations. The buyers were Arab princes, Chinese opportunists and local management.

Lonrho was forced to start selling the family silver in 1992 by a crushing level of net borrowings - more than 1bn - and the process was accelerated in 1994 when German businessman Dieter Boch wrested power away from controversial tycoon Tiny Rowland, who had been CEO for 32 years.

In 1998 the mining operations were split off into what is now called Lonmin (today worth about 4,1bn). Lonrho Africa became little more than a shell, says Lenigas, with nothing but a majority shareholding in Mozambique hotel Cardoso, cash reserves of 18m and the "barmy army", a group of ageing but loyal shareholders with a passion for Africa.

They were game for another crack at Africa and recruited Lenigas to restructure the company and turn it around, which he has done with gusto. Board members are younger and more energetic. The only people remaining from Rowland's era are company secretary Jim Hughes, with Lonrho since 1974, and a handful of financial people, "because of Lonrho's complicated structure".

This week Lonrho announced that Geoffrey White, who joined the company in June as COO, has been made CEO. Lenigas remains executive chairman and will control the board and set strategy.

Though the new investment strategy seems much like the old, there are distinct differences, says Lenigas. "No-one could understand the old Lonrho because its focus was so broad - from hair gel to game reserves. We are clearly focused on infrastructure, transportation, natural resources and support services."

Another fundamental difference is that Lonrho will carry no debt at parent level, nor will it guarantee its subsidiaries' debts. Profitable operations will not support unprofitable ones.

A more subtle transformation is of Lonrho's business-at-all-costs culture, which earned Rowland the disdain of the British establishment and reverence throughout Africa. Twenty years later, Lenigas is committed to transparency and "acceptable capitalism".

"The way I see it," he says, "Lonrho did business the way that Africans did business. But I'm totally transparent - I'm not going to jail for anybody."

Lonrho's new investment spree kicked off with the acquisition of an 8,2% stake in Brinkley Mining, which has uranium operations in SA and interests in the DRC; and a 17% interest in Nare Diamonds, a production and exploration company based in SA.

In May last year Lonrho acquired 63% of the only deep-water port in Equatorial Guinea, which is set to become one of the wealthiest countries in Africa as its huge offshore oil reserves come on stream. The tax-free port is servicing the rapidly growing offshore oil industry, and Lonrho has recently completed a logistics facility for ExxonMobil's local operation.

The government owns the remaining 37% of the port. "I love governments as partners: we are less likely to be nationalised if there is a shake-up in government and policy," says Lenigas.

Lonrho also has a stake in Fly540, a low-cost airline based in Nairobi; and Norse Air, a charter business based in Johannesburg, which holds the contract to provide a cargo and passenger service for AngloGold Ashanti. "That's a gangbuster business [Fly540]. It has operated for less than a year, flies to more destinations than Kenya Airlines and now has partial international rights, so we can fly to the DRC and Sudan, and the business is profitable." Lonrho has an agreement with the Angolan government to launch Fly540 in Angola. "There is huge demand for internal flights in Africa, this is where huge growth will come from in the next decade."

In a similar vein, Lonrho acquired 45% and control of cargo-ship operator SA Independent Liner Services (Sails) for US$6m, with an option to increase its stake to 51% within the next five years. "Nobody is servicing the smaller ports up the east and west coasts and there is demand. Africa needs to get its products to market and I want new, modern, fast ships to ensure that I give the countries we service a competitive edge."

Funding these investments is not a problem at this stage, says Lenigas. "We have raised 53m for acquisitions in the past six months and will raise further capital when it is needed.

"Everyone talks the talk in Africa but no-one writes out the cheques. We get the good deals because we have the ability to pay and thus can act quickly."

At this point, though, it seems investors are acting on faith. The half-year results to March reflected impressive turnover of 10,4m (up from 600 000 in March 2006 and from 3,4m at the September year-end) - but the operating loss was 3m.

Says Lenigas: "We need capital to get the business up and running. But within the group certain businesses are already profitable, like Fly540 and Sails. But if we start Fly540 in Angola, it will require an investment of $6m- $9m and won't make money till the second year. And we are investing $71m in Luba Freeport.

"My gut feel is that if we stopped now, the business would be profitable within a year. But that's not what we are about - we are acquiring businesses as fast as possible that we think will make a difference to Africa."

Unfortunately, though, local shareholders are unable to benefit from Lenigas's optimism. Though the company is listed in London and Johannesburg, the local share is highly illiquid. "At some point we will have to address that; the only way is to do some large financing with those local institutions able to invest outside the country."

RNS Number:7716F Lonrho PLC
16 October 2007

Lonrho Plc
("Lonrho" or "the Company")

Lonrho Acquires 51% of KwikBuild

Lonrho (AIM: LONR) is pleased to announce that it has acquired 51% of KwikBuild Corporation Limited ("KwikBuild"), providers of innovative cost-efficient building solutions, for #2.1m of which #1m has been injected as working capital into the business. This acquisition is in line with Lonrho's strategy for investment in infrastructure in Africa.

KwikBuild uses lightweight building products for rapid and in-expensive construction and has completed projects in South Africa, Angola, Zambia and Mozambique. The existing production is located in Johannesburg, South Africa with a further plant being established in Port Elizabeth, South Africa.

All KwikBuild structures can be erected on any terrain by semi-skilled labour using a dry building process without the need for costly steel or wooden frames. The building materials are weatherproof, fire resistant and provide good insulation.

Lonrho's acquisition of KwikBuild allows for the immediate expansion of KwikBuild's successful South African business model, and KwikBuild will be able to capitalise on Lonrho's African network to access to new markets.

To date, KwikBuild has focussed on large-scale public sector projects. In South Africa, these include providing social housing to the Ministry of Housing; schools to the Ministry of Education, accommodating over 5,000 children; and medical clinics and laboratories for the Department of Health. Similar projects have been completed in Angola, Zambia and Mozambique.

KwikBuild structures are also being used by a leading telecom provider in South Africa, which required buildings to operate and manage their GSM cellular network. Leading mining companies have also used the Kwikbuild structures for their offices and accommodation.

In South Africa, there is immediate demand for 4 million low-cost homes. Presently, KwikBuild is negotiating with local authorities for the re-development of shanty towns.

David Lenigas, Executive Chairman of Lonrho Plc, commented:

"We expect significant uptake of KwikBuild systems across Africa in public works projects for housing, schools, hospitals and government offices. The
acquisition of KwikBuild by Lonrho is an essential part of our longer-term strategy to invest in responsible African infrastructure growth."

16.7m X trade at 50p......

Someone wants LONR stock :)

I don't blame them PP!

Lets hope the same buyer wants more, and Lonrho zooms past 50p and onwards to 60p

Agreed it looks like they have a fresh wind behind them and it may be that the new African funds that we mentioned previously may be the buyers. Lonr board may use strength in sp to raise further funds given the pace of acquisitions. Still it will keep the media busy.

When a fund sells 16million shares for 8 million quid and it doesnt effect the share price significantly is that a good sign ?

Yep, especially as the offer price was 47p and bid around 45p........

The fund was selling, and you normally lose 10% or more when trying to sell a big lump.

So really, what should have been 16.7 sold at say 40p.........was actually 16.7m sold at 50p....

It shows great demand for stock..........

Lonrho PLC
23 October 2007
LONRHO PLC
(Lonrho or the 'Company')

Lonrho announces Ambassador Frances Cook to join Board

Lonrho (AIM: LONR), the conglomerate with a structured portfolio of African investments, is pleased to announce that it has appointed Ambassador Frances Cook as a non-executive Director of the company.

A former United States of America ambassador to Burundi, to Cameroon and to the Sultanate of Oman, Cook also held numerous senior positions in the Department of State, including Deputy Assistant Secretary of State for Refugee Programs, and Deputy Assistant Secretary of State for Political-Military Affairs, Consul General in Alexandria, Egypt, and Director for West Africa. She transitioned to the private sector in May 1999, where she runs an international business consulting firm, The Ballard Group llc. Cook currently serves on the boards of Alliant Techsystems (NYSE) and Global Options Group (NASDAQ), and the Corporate Council on Africa. She is a Senior Fellow at the Center for Naval Analyses, and a member of the Council on Foreign Relations. She was educated at the Universities of Virginia and Harvard, and resides in Washington, D.C.

David Lenigas, Lonrho's Executive Chairman commented:

'I am delighted that Ambassador Cook is joining the Lonrho Board. She brings unparalleled experience of Africa, its politics and opportunities. It is our stated intention to increase the number of influential non-executives on the Board. Ambassador Cook is the first of these appointments and her expertise and guidance will help to ensure Lonrho's transparent and effective growth throughout Africa.

Doesn't seem to have affected the share price today - I thought this looked like a key appointment! But then I guess it will filter through in deals down the line.

RNS Number:2433G
Lonrho PLC 24 October 2007
LONRHO PLC
(Lonrho or the 'Company')

Lonrho announces expansion of Fly540 African fleet with
three BAE 146 aircraft

Lonrho (AIM: LONR), the conglomerate with a structured portfolio of African
investments, is pleased to announce that it is adding three BAE 146 aircraft to
its African fleet.

The aircraft, two BAE 146-300 100 seaters and one BAE 146-200 70 seater will be
delivered within the next eight weeks and will expand the Fly540 operational
network across sub-Saharan Africa.

These aircraft are part of a planned rollout of twelve aircraft for the Company
over the coming year. This will continue to develop the airline model from its
operational base in Kenya to other hubs across sub-Saharan Africa.

The Fly540 airline model is to create a mixed fleet of jets and turbo props that provide East to West and North to South pan African transport routes. The
Company deploys modern aircraft, operated to international standards.

David Lenigas, Lonrho's Executive Chairman commented:

"Fly540's success in Kenya has demonstrated the market demand for a quality
airline operating across the African continent. I am delighted that Fly540 is
now the choice of international carriers for flying their passengers within
Africa. Fly540 is set to fly to eight African countries early in 2008."

From http://www.iii.co.uk


Lonrho's long comeback

Edmond Jackson 05.11.07

One intriguing aspect of long-term investing is how various management styles (or fads, to hard-bitten cynics) fall in and out of fashion. On a 10 to 20-year view, the wheel can actually turn full circle. Take conglomerates, for example. Periodically, the concept of assembling a business group under a listed entity comes into vogue. The 1960s in particular, saw holding companies prosper and expand in both the

UK and US. Hanson Trust originated in Hanson White greeting cards to become a 1980s transatlantic colossus. When the takeover cycle is generally in full flow, listed companies are able to use their highly rated shares as currency to buy unquoted companies (typically on single figure P/Es) and literally manufacture earnings-per-share. They do indeed often achieve economies (such as providing development finance on better terms than a small firm can find on its own) although these tend to be less important than the key driver: raising equity at a relatively high value, based on expectations of ability to do deals, then buying into private businesses more cheaply. Such is a true money machine, for so long as the confidence lasts.

There are times when investors respond keenly to this approach, and at other times with derision. In the go-go 1980s, egged on by easy credit, many stockmarket entrepreneurs became over-stretched. The early 1990s recession exposed weaknesses in many of the conglomerates, with some imploding. 'Conglomerate' became a dirty word and 'focus' the new fashion. Investment bankers who earned fortunes, advising on takeovers, made another mint in fees from corporate restructurings.

Lonrho (LONR.L) - literally 'London-Rhodesia' - was one such company caught up in this classic boom-bust cycle. For many years its founder, Tiny Rowland, rode high both in the City of London and across Africa. He was much more than the average entrepreneur; indeed a charismatic leader who helped to give Lonrho's African firms an almost paternalistic reputation as an employer. Lonrho and Rowland eventually became victims of the conglomerate bust, with the tycoon ousted and seemingly endless strife between shareholder factions until 'Lonmin' was born from Lonrho's mining assets and - helped by soaring platinum prices - became an FTSE 100 company. The rump of Lonrho's other assets listed on AIM.

Making conglomerates work

These swings in business fashion blur a vital fact, relevant to assessing Lonrho currently: that some entrepreneurs can make the conglomerate model work well, especially in developing countries. For example, conglomerates have been a successful feature of various Far Eastern economies since their post-war period of rapid growth.

David Lenigas, the genial Australian resources entrepreneur and now chief executive of Lonrho since December 2005, is quite an example of 'Rowland re-born' in his expansive approach although he has the virtue of entrepreneurial drive without its abrasive edge. Such a hungry, yet sensitive approach ought to work well in deal-making situations, especially where African leaders need to feel confident about foreign investors.

Investors have cast off the 1990's cynicism and are entertaining the concept of a London-listed, African conglomerate, in a fresh light. Lonrho's AIM-listed shares more than doubled in value from 14p last year and at 48p are in a firm market, up 240%, which capitalises the group at £155 million. This equates perfectly with the early, halcyon years of a conglomerate expanding, when its shares attract a premium rating - partly linked to belief in the entrepreneur's ability to cut deals.

Lots of deals

A glance at Lonrho's announcements shows busy deal flow across Africa, in sectors as diverse as resources, infrastructure, transport, support services, hotels and leisure. Investors are looking to Lonrho's assets - and the expectation of further deals - as a benchmark for value, rather than the recent profit and loss account. Interims to end-March showed continuing operations losing £2.5 million on £3.7 million turnover, with acquisitions contributing £6.7 million turnover and a £0.5 million loss. Balance sheet shareholders' funds were £38.7 million. As with any acquisitive group, the combination of assets being integrated and shares in issue, are a moving feast. For the first half fiscal year, Lonrho had an average 224 million shares in issue, now 322 million after placing 45m shares with institutions at 38p in September to raise £17 million to fund group investments.

Separately, Lonrho's launch of a LonZim, a Zimbabwe investment fund, raised £32.3 million in July from the group's existing institutional shareholders, with Lonrho retaining a 39.4% stake. Given Zimbabwe's hyperinflation that may eventually result in economic crisis, this looks as high risk as emerging markets get. You could also say 'fortune favours the brave' and in its risk/reward evaluation, Lonrho has limited its own exposure. An announcement on 1 November revealed Lonrho has appointed Renaissance Capital, an emerging markets specialist, as placement agent to currently raise over £70 million for the fund, prior to an AIM listing.

Lonrho itself has yet to attract much interest among UK brokers (Company REFS cites 'no current forecasts') and the shareholder base is an eclectic set of international investors rather than pension funds, however it retains a keen following among 20,000 private investors since the Rowland era - who are now being rewarded by Lenigas as Lonrho shares rise.

Last July, substantial options - 5.2 million - were granted to board members and senior management at 44p, exercisable until 2012, so there is incentive to create further substantial upside.

The risks of rapid expansion in Africa

There are risks with rapid expansion by conglomerates, for example the possibility of accounting issues arising in specific subsidiaries although the typically eventual risk, of financial over-stretch, should be clear from the balance sheet. Despite the moving feast aspect of Lonrho's finances, its end-March balance sheet was satisfactory and has been enhanced by the recent equity placing.

The key issue for weighing up Lonrho shares is quite straightforward: does Africa represent a worthwhile investment proposition? Conservative investors may shudder at its reputation for Aids, tribal conflict and high-level corruption, however some who are more enterprising are re-appraising Africa's risk/reward profile in light of the commodities boom. Besides portfolio investors, you can see this in the way Chinese firms are scrambling to invest - well over £3 billion equivalent to date - in an effort to source natural resources essential for China's own economic growth. Annual Sino-African trade is now in the region of £30 billion. This is having an economic multiplier effect in Africa, for example improving infrastructure and jobs/incomes.

Rising soft commodity prices should also be helpful, at least for Africa's largely rural population, and the continent is starting to be seen as relatively more stable - with Algeria and Liberia now rated 'stable economies' by the World Economic Forum. Tourism is a major growth opportunity.

Amid doubts about US and European growth prospects - and fears the Far East exporting nations will experience some setback if Western demand eases - the hunt is on for fresh growth themes. 'Africa' may remain a preserve for enterprising investors but it does not require much of a shift in perception to result in the bull market you currently see in Lonrho shares. Direct equity plays on Africa that offer a spread of activities to reduce risk are scant, hence Lenigas's strategy to re-adopt the conglomerate model is timely. There are African investment funds but they have to find their own opportunities; which comes back to Lonrho.

It will be interesting to follow Lonrho as a test of the validity of conglomerates: whether Lenigas can avoid the mistakes of previous entrepreneurs, to deliver long-term sustainable value. Since Lonrho's strategy reflects his expansive personality and deal-making talent, there is a 'key person' risk with these shares.